we find that the weak figures for the mature economies as a whole are driven by Japan (reflecting in part its two ‘lost decades’ of growth post-bubble, but primarily due to likely flawed data) and by Eastern European states (with large falls in incomes following the collapse of the Soviet Union after 1988).Not to suggest that these things did not occur; rather, I find weak the argument that they drive the results. In the figure below, I have estimated the “quasi-nonanonymous” GIC. We see there the growth in real per-capita income among country-deciles sorted by their 1988 income percentiles— with and without China. I have not “reshuffled” incomes when including China, so it is as if Chinese growth had been comparable to its 1988 income peers.
Of course, this latter point was already made clear in Milanovic’s work, as he reminds us.
Ultimately, there are two points:
When we do quasi non-anonymous chart with 1988 country/deciles fixed, we keep 1988 decile populations fixed. Fixed! pic.twitter.com/pdPHcxg6JQ— Branko Milanovic (@BrankoMilan) September 14, 2016
- The years 1988-2008 had seen considerable change in what it means to be part of the global middle class.
- Outside China, the global 10-99th enjoyed only modest growth. To the extent those years saw stagnation among more developed economies, it extended to most of the world. Except China.